Monday, August 24, 2009

Imagine for a moment you're starting your own business from scratch and one of your goals is client service excellence. Then look at your current company and consider whether you're really set up to accomplish this goal. Who or what is the real priority and what would you change?

Most businesses, even professional service firms, are built with internal operations or financial goals as the centerpiece. Within that structure, leaders who espouse client service excellence as a priority then do the best they can to service clients within the parameters of that model. Sounds reasonable so far, but think about the number of times a client wants or needs something you're not set up to provide. Sometimes you can accommodate them, but often times you can't because your business/organizational model doesn't allow for it. When operations and financial considerations drive your organization, you are limited by definition as to how well you can serve your client.

So what if you built or restructured your organization with client service excellence as the centerpiece? What if your financial and operations models were actually based on meeting your clients' needs rather than asking clients to serve yours. How different would you look? How much better could you serve your clients than your competitors? It's just a little food for thought as you consider writing the next chapter for your organization.

Tough economic times are not only about survival, but about building excellence into everything you do and taking the opportunity to create greater distance between you and your closest competitor. The way to do so is to compete with yourself. Getting your team together and evaluating your actual versus espoused priorities is a great place to start.

6 comments:

Leo, as usual, an interesting post. You write:"So what if you built or restructured your organization with client service excellence as the centerpiece? "

I believe that the decision to go into business starts with the idea that there is a market for your product/service and that your ability to deliver will be at least as good if not better than your competitors.

You're right that too many businesses structure themselves for their own convenience rather than that of their customers. Service doesn't seem like a difficult strategy, but in practice it seems fraught. In banking, for example, there is great disagreement about what constitutes good customer service. Most people won't put up with rudeness, or outright lack of common sense, but few are willing to pay extra to get better, more attentive, more individualized service.

Private Banking clients understand the value received for those services, but still prefer to pay nothing. We all want low fees, high interest rates and customized service. Pricing is critical -- to give great, really great, customer service, you have to be able to charge enough to make doing so profitable.

Sean, I think banks offer a classic example for a model where clients are required to serve the bank rather than the bank serving the clients. Many try hard to focus on customer service, but their own organization often serves as the obstacle to achieving excellence. It's one of the reasons banks can debit your account in a nanosecond, but don't tend to be nearly as fast when it comes to crediting it.

In a professional services environment many firms structure a work process based on a client contact through which nearly all communication flows. While that model may make internal communication and workflow easier for the agency, there are many clients who hate it. These clients believe they should be able to pick up the phone and call anyone they want, whenever they want. If that causes issues for the firm, then that's the firm's problem to resolve. And quite frankly, they are correct.

Sean, I think banks offer a classic example for a model where clients are required to serve the bank rather than the bank serving the clients. Many try hard to focus on customer service, but their own organization often serves as the obstacle to achieving excellence. It's one of the reasons banks can debit your account in a nanosecond, but don't tend to be nearly as fast when it comes to crediting it.

In a professional services environment many firms structure a work process based on a client contact through which nearly all communication flows. While that model may make internal communication and workflow easier for the agency, there are many clients who hate it. These clients believe they should be able to pick up the phone and call anyone they want, whenever they want. If that causes issues for the firm, then that's the firm's problem to resolve. And quite frankly, they are correct.

To continue our twitter conversation, I had said that most companies think "profit is king" which brought us to customer service being a prince.

Your response that "Without the King, by definition there is no Prince" got me thinking.

Why do businesses exist? Is it for profit or something else? In this, I think Sean is on the right track but I'm willing to go further.

If we go way back in history, business (or trade) began because of specialisation. Certain people would specialise in what they did best and would trade their work for what they need. There was no profit involved. This was a social endeavour.

Now before someone says that things are different today... I think that in most cases this is still how it works. We're constantly being told that small businesses make up the majority of the workforce. And, most small businesses don't make a profit, they make a salary for the owner who actually does at least some of the work.

The small business owner's "profit" is a salary that varies depending on the need for his/her product or service within society with other smaller variations based on quality, customer service, etc.

This is very close to the original artisans that originally existed.

Hence, I really think that profit should be dethroned. It's all about delivering a product or service that society needs and doing it well. As I've mentioned on Twitter before, profit is nice to have but shouldn't be the objective.

Eric, while I think self interest is still the thread in your look back through history, let me offer this. Let's say ALL you care about in the whole world is making a profit. Consider the approach of Herb Kelleher at Southwest with shareholders whose sole purpose in investing in the company is their belief that their money will work harder for them at Southwest than anywhere else. To make the most money and to achieve the greatest return on investment for his shareholders (and to ultimately keep them happy), they rank FOURTH on Kelleher's priority list. He understands that to deliver the results shareholders want, then his priorities must line up this way: Employees first, then customers, communities, and finally shareholders. The customer is your economic engine. You can have the greatest product, lowest operating costs, etc. Without customers/clients, you're nowhere. In Kelleher's model, employees are prioritized first because be believes, as Hal Rosenbluth does, that your customers will get better service and be the big winners as a result. Communities play a role because the stronger the communities, the healthier (economically and otherwise) your employees and customers will be. As a result, it maximizes profits and ROI for shareholders. So even if profit is your God, you'll never, ever realize your full profit potential without a customer/client centric strategy.

My posted serves as an exercise for organizations to ask themselves if they are doing their very best to serve their clients/customers. With any luck, some of them may give it a try. Thanks for the great dialogue on this.

Leo, I agree entirely! And frankly, profit is just another reason to make customer service a top priority.

I've just been thinking a lot recently about the role of profit historically and culturally. So, I threw it out there.

I think that no matter what your conception of business and no matter what your primary goal, if you make customer service the top priority, you increase the likelihood that you'll succeed and achieve your goal.